According to a report from Flowtown, it is 6 to 7 times more costly to acquire a new customer than to retain an existing customer. Therefore, it’s equally important, if not more, to cultivate and maintain loyal customers while attracting new customers. Here are some tips for your reference.
Make customers love your products
Product is typically the base of a business. It’s not only an important factor that can distinguish you from your competitors, but also a key reason to keep customers coming back repeatedly. Products loved by customers often have something in common:
- Realize promised value: Have your products worked as advertised? If yes, customers are likely to stay satisfied with your products even though they may have higher expectations. Sure, it will be much better, if you give customers more than you promised.
- Deliver a pleasant user experience: Customers are people; people have emotions. Bringing a pleasant experience to the users can produce great influence on improving customer loyalty and spreading your brand. This requires you to invest in the usability, design and interactive experience of your products on top of just features. As to how to know customers’ real feelings about your products, social media can be a great tool.
- Provide dedicated support: Service is the most direct way customers feel their importance in your business. Be responsive and helpful whenever customers need your assistance, from pre-sales queries to post-sales support. Let the customers know you are always standing by.
Build a customer health scoring system
You may find it helpful to set up a scoring system that can incorporate feedback from new and old customers such as the NPS system. NPS (Net Promoter score) is a popular customer loyalty analysis metric. It was first proposed by Fred Reichheld as a customer satisfaction survey method in his book The Ultimate Question. You can calculate NPS of your company by subtracting the percentage of customers who are detractors from the percentage who are promoters.
This method can effectively differentiate good profits and bad profits. Quite many companies may choose to maximize temporary profits by sacrificing their future growth. That’s “bad profits”. Actually, it’s not healthy to gain new visitors at the cost of old customers’ benefits. With the employment of NPS, you can discover the challenges both new and old customers are facing, and then evaluate each customer with a unified health standard. Here’s a three-level heath standard:
Good Health: Customers are using your products proficiently and have a good experience.
Average Health: Customers are using your products, but not skillfully and have some bad experience.
Poor Health: Customers are not using your products due to bad experience.
Only when you have a deep understanding of each customer’s health can you solve the customers’ issues in an effective way and without harming old customers’ benefits.
Nurture your paid customer base
Either products or customers have a life cycle so it’s important to treat customers differently according to their phases in the life cycle. There are two basic principles: Firstly, once a customer starts to pay, never give up on him/her. Secondly, do not treat every customer in the same way. Use different methods and service standards to treat different customers.
For example, you can send customer success stories to the potential customers; for those who have once used your products but now stopped, try to clear their specific concerns and encourage them to continue the use. And as to loyal customers, you can seek some suggestions about your products or services and respond to them in a timely manner.
Learn from lost customers
When customers stop using your products, you lose them. Do you know why each of the customers leaves you? No, because they may even never respond to you. It would be helpful to create a lost customer database which includes the following:
Reason: Why do they give up on your products?
Lifetime: How long have they used your products?
Solution: How to make them continue using your products?
This database can help you with identifying the reasons of your client loss and what’s more important, preventing future losses. It can also give you insights on better serving your current customers. Happy customers will bring you more customers and opportunities while unhappy ones may cause public relation crises. Therefore, loyal customers are the most important assets of your business.